Ensuring healthy lives and promoting well-being at all ages is essential for sustainable development. Before the pandemic, great strides had been made in improving the health of millions of people; significant progress was made in increasing life expectancy and reducing some of the common deaths associated with infant and maternal mortality.
But the emergence of the Sars Cov-2 (Covid-19) pandemic highlighted the critical need for preparedness. The United Nations Development Program revealed the huge disparities in the capacity of countries to cope with and recover from the pandemic, which implies an obstacle to the realization of one of the UN's major Sustainable Development Goals (SDGs), which is to ensure healthy lives for all, based on the premise that healthy people are the foundation of healthy economies.
Indeed, the most revolutionary aspect of the Sustainable Development Goal 3 is achieving universal health coverage, a goal many consider too ambitious and challenging to achieve or measure. It is intended to ensure that all people have the good quality health services they need, without suffering financial hardship, to increase equity in health outcomes so that even the poorest can receive the care they need, and to address health issues at all ages.
Universal health coverage will be achieved if properly implemented, meeting the demand for primary care for all, and encouraging the provision of health promotion, prevention, cure, palliation, and rehabilitation services. Over the next 15 years, this could bring about a real transformation in both rich and emerging countries, in which health improvements reach everyone equally and not just certain groups. Causal analyses of 153 countries reveal that increased health coverage typically improves access to needed care and also improves the health of the population, with the poorest benefiting the most.
However, universal health coverage and promoting healthier lives require investment in health systems. A growing body of empirical research shows that investment in health systems is critical to better health outcomes. If current post-pandemic trends continue, only 39% to 63% of the world's population will be covered by essential health services by 2030. For universal health coverage to become a reality by that time, growth in the provision and use of essential health services must be greatly accelerated, in addition to removing economic barriers to accessing care and ensuring that no one forgoes treatment because of cost.
Access to better medical treatment, improved quality of life, and better hygiene have been key factors in a prolonged healthy life. Three important factors for identifying diseases at an early stage and taking measures to continue to positively impact health in the world are lifestyle changes (habits and diet), medical progress, and digitalization (especially Artificial Intelligence).
However, this demands strong investments and a great commitment from countries, financial institutions, and investors to strengthen the development of more and better tools focused on health. Seen in another way, this global challenge can be translated into a business opportunity.
Evolution of the Healthcare Industry
Concern for health collectively came with the first epidemics that affected a greater number of people; then, thought was given to the cause. In the 1300s, when the Black Death struck, an Arab physician reported that the disease could be contracted by contact with the sick or through clothing, pottery, or earrings.
Then, science had a breakthrough; a more rational view of the disease began to be given, and it became possible to think of ways to avoid the epidemics of the time. Scientific research began, and great discoveries were made to prevent some diseases and contain contagions. Vaccines for the prevention of diseases such as tuberculosis, tetanus, or meningitis were developed. At the end of the 16th century, the first microscope was discovered in this period, one of the most innovative instruments that changed how humans saw the world.
With the Industrial Revolution, social medicine emerged from intertwining three movements: the German medical police with compulsory disease control measures, French urban medicine, and workforce medicine. It was not until the middle of the 19th century that the expression of social medicine was registered.
Subsequently, germs were discovered, which gave way to new ways of understanding disease and discoveries and non-social concepts of disease that led to biomedicine centered on the disease and not on the individual.
From the second half of the 19th century onwards, the Microbial Theory of Disease or Germ Theory of Infectious Diseases was established, marked by the research of Pasteur and Koch, which dramatically transformed medicine from "a people-oriented profession to disease-oriented illness" leading to public health legislation and the institutionalization of teaching.
Over time, health began to be treated as a positive concept and not only as a concept of the absence of disease, and in 1946, the current concept of health proposed by the World Health Organization emerged.
On the technical side of the health sector, the emergence of the microscope was followed by ultrasound X-rays, laboratory tests, and more and more new and better support tools for the health sector. But it was not until the early years of the 20th century that technology began to become part of the health area through a continuous flow of investments.
From the discovery of x-rays and electrocardiograms to the arrival of antibiotics, surgical services, respirators, and procedures, all this has been possible thanks to those who decided to invest in technology, not necessarily altruistically, but as a business opportunity.
Technology in Health
Investment in healthcare technology has made it possible, among many things, to understand the behavior of the nervous system or the constant monitoring and control of intensive care processes. It continues to advance radically to prevent diseases. Technology has become a major tool in the evolution of the healthcare area and will continue to advance radically with the use of Artificial Intelligence (AI).
Investment opportunities in the healthcare market worldwide are increasing more and more. Applications and online technological platforms for healthcare have begun to attract the attention of large private equity funds, and some governmental institutions in the world as well as some public-private partnerships. This has provided greater ease of investment to projects and programs that benefit the population in health issues and access to quality medical services at a low cost, which end up increasing the population's quality of life.
Investment in health technologies has a great impact, as it is, for example, in Artificial Intelligence (AI). Research launched by the consulting firm Accenture covering 12 developed economies, generating more than 0.5% of the world's economic output, predicts that by 2035 AI could double annual global economic growth rates.
In 2020 global investment in artificial intelligence applied to healthcare hovered around US$68 Billions, of which US$42.2 Billions came from private investors. By 2021 the market reached US$383.3 Billions, according to International Data Corporation (IDC). This institution estimates that the Artificial Intelligence market is evolving remarkably and will close this year at nearly US$450 Billions, maintaining a high year-on-year growth rate over the next five years.
Although Artificial Intelligence in healthcare dates back almost fifty years, it has come a long way. Investments in it transform how healthcare is provided while generating profits for investors. Every advance in healthcare technology is an investment opportunity in powerful projects that generate interesting returns from the healthcare sector's point of view.
Health technology makes it possible, for example, to discover patterns and insights humans could not find on their own; to predict, control, and monitor epidemics, outbreaks, and diseases; to establish learning and education models for the population. AI can "see" what humans might miss because people are good at finding what they are looking for, but not so good at finding what they are not looking for.
Investment in technology is present in the discovery of new drugs, in the interpretation of radiological images, and even in the analysis of a patient's genome. It has proven to be of great use in the detection of tumors. It is tremendously helpful for those with some kind of physical or mental impairment. And they allow for the monitoring of elderly people living alone.
One example of what technology does for health is the following: Moderna quickly launched the first effective vaccine against Covid-19 due to technology. Moderna's Director of Data and Artificial Intelligence, Dave Johnson, explained that algorithms and robotic automation helped them go from manually producing about 30 mRNAs (a critical molecule for the vaccine) each month to being able to produce about 1,000 per month.
In summary, technology applied to healthcare increases the possibility of
- standardizing, improving, and being more precise in all areas
- facilitates massive data analysis to improve healthcare
- improves communication between entities and providers and between professionals and patients
- offers investors the opportunity to obtain profits by supporting the achievement of one of the development goals set by the UN.
Doing Business Supporting Health
Without hesitation, technology has entered medicine to accelerate processes and solve the ever-increasing needs of individuals. So much so that, in today's landscape, the investment that different equity funds have made in companies or groups that in some way become a technology solution for medicine or healthcare reached US$8.2 Billions by 2020, according to data from Prequin, an alternative asset industry analysis service.
The digital healthcare sector is being driven by the expanded use of EHR (Electronic Medical Record) and EMR (Electronic Medical Record in Spanish) systems, the amplified use of big data in the healthcare sector, assistance in managing patients' electronic medical records, and legal obligations. In addition, the market is expanding due to the growing trend toward preventive healthcare and increasing investment in various mobile healthcare companies.
The McKinsey Global Institute forecasts that around 70% of companies will adopt at least one type of advanced technology by 2030, while less than half of large companies will deploy the full range. It estimates that AI could generate an additional economic output of about US$13 Trillions by 2030, increasing global GDP by 1.2 % annually.
McKinsey says automation can, on the one hand, facilitate the emergence of massively scaled organizations and, on the other, enable small players, and even individuals, to undertake projects that are now mainly done by larger companies. He asserts that "early adopters," i.e., companies that fully absorb the technological tools in the next five to seven years, are likely to benefit disproportionately.
Investing in medical technology is something that many countries are doing, even though it is costly to develop. China has understood its importance and is taking it as strategic, which is why it has invested more than US$150 Billions in artificial intelligence; in turn, the United States is advancing in the application of this technology indirectly through its main companies, and it is estimated that, together, they have already invested more than US$55 Billions since 2015.
According to a comprehensive research report prepared by Market Research Future (MRFR), "Digital Healthcare Market Insights by Delivery Mode, Application, Component, End User, Technology, and Region - Forecast to 2030," the market will reach US$767.7 Billions by 2030 with a year-on-year growth rate of 22.5%.
Opportunities to invest for the benefit of healthcare envisage a digital health market segmented into technology (mobile health, which is one of the most prominent trends in the digital health market); application (increased demand for patient-centric monitoring services, and solutions); modes of delivery (big data in the cloud); components (specialized software, electronic health record); and end users (smartphones and tablets).
Investment in healthcare technology has a positive outlook. Enrique Cortés Rello, Director of the Artificial Intelligence HUB at the Monterrey Institute of Technology in Guadalajara, said during a recent conference that investment in the use of AI is economically viable: "We carried out a study with the Inter-American Development Bank (IDB) that demonstrated with numbers that for every peso invested in technology for level 1 healthcare, in 5 years that investment of one peso will return between 3 and 10 pesos to the healthcare system".
If this were not the case, many pharmaceutical and biotech companies would not be investing to capitalize on the power of technology in drug discovery, minimizing the trial-and-error processes of R&D, with a speed and accuracy previously impossible.
The digital healthcare business in the U.S. has been growing rapidly, as the country spends a lot of money on healthcare, and the drive to save money is pushing demand for digital healthcare. Meanwhile, Europe has been the second-largest global digital healthcare market gainer. Due to substantial improvements in healthcare infrastructure and the growing number of healthcare IT providers, Asia-Pacific is expected to have the fastest growth rate in the coming years.
What has been achieved so far in terms of technology in the healthcare sector has brought numerous benefits to healthcare institutions, doctors, and patients, as well as to the developers of technological solutions and the investors themselves. But more efforts are needed to completely eradicate a wide range of diseases and address many persistent and emerging health problems.
Focusing on more efficient financing of health systems, improved sanitation and hygiene, and greater access to doctors can make significant progress in helping to save the lives of millions of people.
Looking ahead, it is estimated that AI alone will contribute US$15.7 Trillions to global economic growth by 2030, which is estimated to increase health sector profits by 55% by 2035. Therefore, it is expected that this technology will occupy an increasingly important place in our lives when it comes to solving complex problems and will bring greater convenience, productivity, and safety.
Five years ago, Allianz GI launched the first strategy to invest in artificial intelligence through its Allianz Global Artificial Intelligence fund. This did not mean investing only in technology, but in multiple sectors that apply AI to develop, as in the case of healthcare.
For its part, Imantia Futuro Healthy, a Spanish investment fund with a 100% focus on healthcare, capitalized on the pandemic by supporting investments in that sector. They realized that health was the great refuge from the crisis, but at the same time, it opened their eyes to the challenge of longevity. Mario Diaz, the fund's Business Director, said: "We are living longer and longer, and that means taking better care of our elders. We cannot turn our backs on them. We owe it to them. At Imantia, we believe that we can all invest and earn, little by little and easily, and that you can do it in companies that do worthwhile things.
The third Sustainable Development Goal proposed by the UN is a great opportunity to invest and earn returns while supporting the cause of global health. But, according to the Inter-American Development Bank (IDB), "traditional sources of public financing are simply not enough. Fortunately, in the private sector, we are seeing a shift away from traditional investment toward models that not only generate returns but also seek to have a positive impact on society and the environment."
According to the IDB, the business world has already entered the era of sustainable investment, or what they call "SDG financing", i.e. investment decisions aimed at generating measurable impact measures in line with the SDGs.
It is, therefore, time to make a firm commitment to investing in health systems that help to respond to the challenges and needs of social development while at the same time generating profits; investing with social and financial sense. Health problems are a great business opportunity to facilitate the development of all kinds of products, tools, and devices to address different types of diseases and generate new projects that contribute to better health while generating profits.
Would you be interested in venturing or investing in health solutions? Can you imagine what would have been if you had invested in penicillin or X-rays? Can you imagine the outcome of investing in the cure for Cancer or Alzheimer's?
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